US embassy cable - 04AMMAN3425

UNCLAS AMMAN 003425 
 
SIPDIS 
 
NOFORN 
SENSITIVE 
 
USTR FOR C. NOVELLI AND E. SAUMS 
 
E.O.: 12958: N/A 
TAGS: ETRD, PREL, KTIA, JO 
SUBJECT: JORDAN HINTS AN FTA WAIVER FROM DAMAN PROGRAM WILL 
NOT FLY 
 
REF: AMMAN 2790 
 
SENSITIVE BUT UNCLASSIFIED/NOFORN.  FOR USG USE ONLY. 
 
1.  (SBU)  Post this week received a letter from Deputy Prime 
Minister Halaiqa, dated April 29, which attempts to walk the 
cat back from a previous exchange with the Ambassador 
(reftel) in which Halaiqa had been forward-leaning, 
suggesting that exemption of U.S.-origin imports from the 
DAMAN pre-shipment inspection program might be possible under 
the FTA.  (Post is faxing a copy of the three-page letter to 
NEA/ARN.)  The letter acknowledges a "request to be 
exempted", but outlines why the DAMAN program is consistent 
with the WTO principles.  The letter states that DAMAN does 
not constitute an impediment to exporting U.S. shipments to 
the Jordanian market.  (NOTE:  Post will provide separately a 
point-by-point analysis of the letter, showing why we think 
DAMAN is both a barrier to existing trade, especially in 
automobiles, and blocks market access to would-be U.S. 
exporters, as seen in one graphic example in reftel.  END 
NOTE.) 
 
2.  (SBU)  The letter concludes, however, by reinforcing DPM 
Halaiqa's more positive assurances from exchanges earlier 
this year that the Government of Jordan is committed to 
facilitating trade flows and enhancing trade relations, and 
will continue to discuss with the U.S. the DAMAN issue. 
 
3.  (SBU/NF)  COMMENT: The letter echoes what some at the 
working level have been saying privately:  the GOJ cannot 
find a way to waive the U.S. from DAMAN without violating WTO 
rules against discrimination.  We believe that the intent of 
the letter is to convey this message formally, without saying 
so explicitly.  We will see Halaiqa at the earliest 
opportunity to raise DAMAN's inconsistency with the bilateral 
Free Trade Agreement (FTA).  Following that conversation, we 
will provide recommendations on handling this issue at the 
early June FTA Joint Committee (JC) meeting. 
HALE